MICROCAPITAL BRIEF: Deutsche Bank Secures Private Equity Investments of $64m in Microfinance Investment Vehicle European Fund for Southeast Europe (EFSE)

Deutsche Bank, a Germany-based international bank, recently secured EUR 51 million (USD 64 million) from undisclosed private investors for the senior tranche of the European Fund for Southeast Europe (EFSE), a microfinance investment vehicle (MIV) based in Luxembourg. This investment is intended to finance up to 10,000 loans to micro- and small enterprises (MSEs) in the fund’s target regions of Southeast Europe and the South Caucasus.

As of March 2012, EFSE has EUR 828 million (USD 1 billion) in outstanding commitments: 37 percent supplied by public investors, and 63 percent from private sources.

By Mihaela Grindeanu, Research Associate

About Deutsche Bank: Founded in 1870, Deutsche Bank is an international bank with assets totaling EUR 2.1 billion (USD 2.6 billion) as of 2011. Headquartered in Germany, the bank has employees in 76 countries around the world. Deutsche Bank operates a microcredit development fund that provides financing to microfinance institutions (MFIs) to attract further resources on a leveraged basis from local commercial banks. The microcredit development fund reported to MixMarket total assets of USD 3.3 million.

About the European Fund for Southeast Europe (EFSE): Established in 2005, the European Fund for Southeast Europe aims to foster economic development in southeastern Europe and parts of Central Asia by supporting the provision of financial services to low-income households and micro- and small enterprises via local financial institutions. EFSE was initiated by KfW Entwicklungsbank, a German development bank, with support from the German Federal Ministry for Economic Cooperation and Development (BMZ in German) and the European Commission. EFSE is privately managed, with Oppenheim Asset Management Services of Luxembourg acting as fund manager and Finance in Motion GmbH of Germany acting as fund advisor. As of March 2012, EFSE has an outstanding investment portfolio of EUR 722.8 million (USD 885 million). As of 2012, EFSE holds a label from LuxFLAG, an organization that certifies that microfinance investment vehicles actually invest in the microfinance sector.

Sources and Additional Resources:

Efse.lu Press Release: “Deutsche Bank secures additional investments in EFSE microfinance fund”, http://www.efse.lu/Details—2012-07-02-Deutsche-Bank-secures-additional-investments-in-EFSE–microfinance-fund——_nav._siteid.134_entryid.448_dir._likecms.html

MicroCapital.org story, January 3, 2012: “MICROCAPITAL BRIEF: Deutsche Investitions-und Entwicklungsgesellschaft GmbH (DEG), European Fund for Southeast Europe (EFSE), European Investment Fund to Loan $38m to Alternatifbank A.S. (ABank) of Turkey”, https://www.microcapital.org/microcapital-brief-deutsche-investitions-und-entwicklungsgesellschaft-gmbh-deg-european-fund-for-southeast-europe-efse-european-investment-fund-to-loan-30m-to-alternatifbank-a-s-abank-of-tu/

MicroCapital.org story, June 12, 2012: “MICROCAPITAL BRIEF: Austrian Development Bank Oesterreichische Entwicklungsbank AG (OeEB) to Invest $18.75m in European Fund for Southeast Europe (EFSE)”, https://www.microcapital.org/microcapital-brief-austrian-development-bank-oesterreichische-entwicklungsbank-ag-oeeb-to-invest-18-75m-in-european-fund-for-southeast-europe-efse/

MicroCapital Universe Profile: Deutsche Bank, https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Deutsche+Bank

MicroCapital Universe Profile: European Fund for Southeast Europe, https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=European+Fund+for+Southeast+Europe+%28EFSE%29

Browse the MicroCapital Universe and add your entry to the wiki at: https://www.microcapital.org/microfinanceuniverse/